Irish-backed UK pub operator Mitchells & Butlers has agreed a £650m (€760m) pension insurance deal with Legal & General.
The deal insures all members in the Mitchells & Butlers executive pension plan, British insurer L&G said in a statement.
British companies have been paying insurers to take on the risk of their defined benefit, or final salary, pension schemes in recent years through the so-called bulk annuity market, as the schemes are costly to run, and many are in deficit. Insurance enables companies to take pension risk off their balance sheets.
The bulk annuity market will likely see a lower value of transactions this year than last, industry specialists say, due to a lack of large, £1bn-plus, deals. However, the pipeline remains strong, they add.
Mitchells & Butlers is part-owned by Irish horseracing tycoons John Magnier and JP McManus. The duo jointly own — through their Elpida investment vehicle — more than 23% of the business, which owns UK pub and family restaurant chains such as O’Neill’s, All Bar One and Harvester.
Last month, the group reported a narrowing of its annual losses, but warned rising costs and labour shortages, due to Brexit, may hamper future earnings.
- Reuters and Irish Examiner